Published 5:30 am, Wednesday, August 10, 2005

Bush touts economy, admits health care, energy concerns

President urges Congress to pass his plan to limit damage awards in malpractice cases

CRAWFORD - President Bush painted a rosy picture of the economy Tuesday but acknowledged that rising health care and energy costs are contributing to public anxiety and could dampen economic growth.

After meeting with his economic advisers at his Texas ranch, Bush touted a spate of economic good news, including an increased rate of job creation, that the president said justified his economic policies. The policies, he emphasized, include making permanent the income tax cuts that Congress approved during his first term.

The president said he was more concerned about energy and health care costs than the Federal Reserve's decision Tuesday to raise interest rates a quarter of a percentage point, increasing borrowing costs to blunt inflation.

To address health care costs, Bush urged Congress to approve his plan to limit damage awards in medical malpractice cases and allow small businesses to pool resources to buy health insurance. "Medical liability reform will help make health care costs more affordable and health care more accessible for our folks," Bush said.

The president said that while the sweeping energy legislation he signed this week "isn't going to lower people's gasoline prices overnight," it includes incentives for domestic oil producers that in the long run can reduce reliance on foreign oil.

The Bush administration placed a high priority on the passage of energy legislation and has spent less effort on health care measures, which have languished in Congress.

But the president's advisers now acknowledge that increasing health care expenses have undercut some of the encouraging news on the economic front and help explain recent polls that show most Americans disapprove of the president's handling of the economy.

The study dismissed medical malpractice costs as the major reason for higher health care costs, saying that even though Americans sue more frequently, average damage awards here are no higher than in a number of industrialized nations.

The Congressional Budget Office in a 2004 report found that medical malpractice costs made up less than 2 percent of total health care costs.

Bush also called on lawmakers Tuesday to approve his Social Security plan, which includes the creation of private investment accounts for retirement. The legislation has been stalled on Capitol Hill and polls show widespread public skepticism of the plan.

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The president said Tuesday that his economic plan included restraints on government spending and a reduction of the federal budget deficit.